Trading update also shows slight fall in construction order book, but group's financial position remains strong

Revenue at Morgan Sindall's fit-out division in the first half of this year fell by around one-quarter from the same period a year ago.

The group made the announcement as part of its trading update for the six months to 30 June 2009. It said it expected present market conditions to continue throughout the second half of the year.

For its construction division, Morgan Sindall said that the forward order book was down slightly compared with the start of the year. However, it said this was balanced by a rise in the number of pipeline projects at preferred bidder stage, and added that construction's performance continued to improve.

In the infrastructure services division, the level of bidding activity for utilities and civil engineering contracts increased significantly during the period, and the group won a AMP5 utilities contract with Severn Trent valued at £500m over 10 years.

Performance in the housing section has fallen slightly since the start of the year, but the group said revenue from refurbishment and new-build social housing contracts remained robust although the urban regeneration market was still quiet.

Morgan Sindall's forward order book stands at £3.6bn, and the group said its financial position remained strong, with £75m of banking facilities recently renewed through to mid-2012.